CF Industries Holdings, Inc. CF gains on strong nitrogen fertilizer demand in major markets, higher nitrogen prices and its operational strength amid headwinds from higher natural gas costs.
The CF stock has gained 15.4% in the past year compared with the Zacks Fertilizers industry’s 54.2% decline.
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Let’s find out why CF stock is worth retaining at the moment.
Healthy Nitrogen Demand, Higher Prices Aid CF Stock
CF Industries is capitalizing on the growing global demand for nitrogen fertilizers, driven by strong agricultural activity. Global nitrogen requirement is expected to remain strong in the near future due to recovering industrial demand and farmer economics.
High levels of corn-planted acres in the United States should drive the demand for nitrogen. Demand in North America is expected to be fueled by favorable farm economics. Demand for urea is likely to remain healthy in Brazil in 2026, driven by higher corn plantings. In India, demand is expected to be driven by low inventory levels, reduced domestic production and undelivered volumes due to the Iran war. The company expects India’s urea imports to rise year over year in 2026, potentially reaching 10-12 million metric tons.
CF, on its first-quarter call, said the global nitrogen market remains tight in 2026 due to strong demand, geopolitical disruptions and constrained natural gas availability. The Middle East conflict has further tightened the global nitrogen supply-demand balance.
Higher nitrogen prices have also contributed to a boost in CF Industries’ revenues. In the first quarter, net sales rose roughly 19% year over year on pricing strength. The average selling prices for the company’s core products increased compared to the prior year, driven by supply disruptions and strong global nitrogen demand. Looking ahead, CF should continue to benefit from favorable pricing trends.
Higher Natural Gas Costs Ail CF Industries
CF remains hamstrung by headwinds from higher costs stemming from an uptick in natural gas prices. Higher prices of natural gas, a key feedstock for nitrogen fertilizer, have resulted in increased production costs for CF. It saw a notable rise in natural gas costs during 2025. The average cost of natural gas increased to $3.31 per MMBtu (million metric British thermal unit) in 2025 from $2.40 per MMBtu a year ago.
The same for first-quarter 2026 increased to $4.57 per MMBtu from $3.68 per MMBtu a year ago, leading to a higher cost of sales. Natural gas prices have shot up in Europe and Asia due to constrained supply availability. Higher gas costs are expected to weigh on CF’s margins.
CF Industries Holdings, Inc. Price and Consensus
CF Industries Holdings, Inc. price-consensus-chart | CF Industries Holdings, Inc. Quote
CF’s Zacks Rank & Other Key Picks
CF currently carries a Zacks Rank #3 (Hold).
Better-ranked stocks in the Basic Materials space are L.B. Foster Company FSTR, Albemarle Corporation ALB and LyondellBasell Industries N.V. LYB. FSTR, ALB and LYB carry a Zacks Rank #1 (Strong Buy), each. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for L.B. Foster’s current-year earnings is pegged at $1.74 per share, implying a 152.2% year-over-year increase. The Zacks Consensus Estimate for FSTR’s current-year earnings has been revised 12.3% higher over the past 60 days.
The consensus estimate for Albemarle’s current-year earnings is pegged at $12.98 per share, indicating a 1,743.2% year-over-year increase. ALB’s earnings beat the Zacks Consensus Estimate in three of the trailing four quarters and missed once, with an average surprise of 54.1%.
The Zacks Consensus Estimate for LyondellBasell’s current-year earnings stands at $9.22 per share, implying a 442.2% year-over-year increase. The Zacks Consensus Estimate for LYB’s current-year earnings has been revised 69.5% higher over the past 60 days.
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CF Industries Holdings, Inc. (CF): Free Stock Analysis Report
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This article originally published on Zacks Investment Research (zacks.com).